SALESFORCE INC (CRM) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:CRM - US79466L3024 - Common Stock
259.94 USD
-0.59 (-0.23%)
258.3 USD
-1.64 (-0.63%)
Overall CRM gets a fundamental rating of 6 out of 10. We evaluated CRM against 276 industry peers in the Software industry. CRM scores excellent on profitability, but there are some minor concerns on its financial health. CRM has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
CRM had positive earnings in the past year.
In the past year CRM had a positive cash flow from operations.
CRM had positive earnings in each of the past 5 years.
In the past 5 years CRM always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of CRM (7.59%) is better than 77.90% of its industry peers.
The Return On Equity of CRM (12.03%) is better than 75.72% of its industry peers.
The Return On Invested Capital of CRM (10.05%) is better than 84.78% of its industry peers.
CRM had an Average Return On Invested Capital over the past 3 years of 5.83%. This is below the industry average of 10.78%.
The last Return On Invested Capital (10.05%) for CRM is above the 3 year average (5.83%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.59% | ||
| ROE | 12.03% | ||
| ROIC | 10.05% |
ROA(3y)3.46%
ROA(5y)3.61%
ROE(3y)5.81%
ROE(5y)5.94%
ROIC(3y)5.83%
ROIC(5y)3.79%
1.3 Margins
With an excellent Profit Margin value of 17.91%, CRM belongs to the best of the industry, outperforming 80.43% of the companies in the same industry.
In the last couple of years the Profit Margin of CRM has grown nicely.
CRM has a better Operating Margin (22.03%) than 88.41% of its industry peers.
In the last couple of years the Operating Margin of CRM has grown nicely.
The Gross Margin of CRM (77.73%) is better than 75.00% of its industry peers.
CRM's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.03% | ||
| PM (TTM) | 17.91% | ||
| GM | 77.73% |
OM growth 3Y107.25%
OM growth 5Y49.51%
PM growth 3Y44.23%
PM growth 5Y85.88%
GM growth 3Y1.66%
GM growth 5Y0.52%
2. Health
2.1 Basic Checks
CRM has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for CRM has been reduced compared to 1 year ago.
CRM has more shares outstanding than it did 5 years ago.
CRM has a better debt/assets ratio than last year.
2.2 Solvency
CRM has an Altman-Z score of 5.26. This indicates that CRM is financially healthy and has little risk of bankruptcy at the moment.
CRM's Altman-Z score of 5.26 is fine compared to the rest of the industry. CRM outperforms 73.19% of its industry peers.
CRM has a debt to FCF ratio of 0.65. This is a very positive value and a sign of high solvency as it would only need 0.65 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 0.65, CRM is doing good in the industry, outperforming 77.54% of the companies in the same industry.
A Debt/Equity ratio of 0.14 indicates that CRM is not too dependend on debt financing.
CRM has a Debt to Equity ratio of 0.14. This is comparable to the rest of the industry: CRM outperforms 49.64% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 0.65 | ||
| Altman-Z | 5.26 |
ROIC/WACC0.92
WACC10.9%
2.3 Liquidity
CRM has a Current Ratio of 0.98. This is a bad value and indicates that CRM is not financially healthy enough and could expect problems in meeting its short term obligations.
CRM has a worse Current ratio (0.98) than 75.72% of its industry peers.
A Quick Ratio of 0.98 indicates that CRM may have some problems paying its short term obligations.
With a Quick ratio value of 0.98, CRM is not doing good in the industry: 74.64% of the companies in the same industry are doing better.
CRM does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.98 | ||
| Quick Ratio | 0.98 |
3. Growth
3.1 Past
CRM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 18.76%, which is quite good.
The Earnings Per Share has been growing by 27.71% on average over the past years. This is a very strong growth
The Revenue has grown by 8.41% in the past year. This is quite good.
CRM shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 17.25% yearly.
EPS 1Y (TTM)18.76%
EPS 3Y28.52%
EPS 5Y27.71%
EPS Q2Q%34.85%
Revenue 1Y (TTM)8.41%
Revenue growth 3Y12.67%
Revenue growth 5Y17.25%
Sales Q2Q%8.63%
3.2 Future
Based on estimates for the next years, CRM will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.75% on average per year.
The Revenue is expected to grow by 9.51% on average over the next years. This is quite good.
EPS Next Y16.58%
EPS Next 2Y13.6%
EPS Next 3Y13.58%
EPS Next 5Y14.75%
Revenue Next Year9.34%
Revenue Next 2Y10.22%
Revenue Next 3Y9.9%
Revenue Next 5Y9.51%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 22.56, CRM is valued on the expensive side.
Based on the Price/Earnings ratio, CRM is valued a bit cheaper than the industry average as 71.74% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 27.19, CRM is valued at the same level.
Based on the Price/Forward Earnings ratio of 19.77, the valuation of CRM can be described as rather expensive.
75.00% of the companies in the same industry are more expensive than CRM, based on the Price/Forward Earnings ratio.
CRM's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 23.92.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.56 | ||
| Fwd PE | 19.77 |
4.2 Price Multiples
CRM's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. CRM is cheaper than 77.90% of the companies in the same industry.
CRM's Price/Free Cash Flow ratio is rather cheap when compared to the industry. CRM is cheaper than 80.07% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.19 | ||
| EV/EBITDA | 19.75 |
4.3 Compensation for Growth
CRM's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
CRM has an outstanding profitability rating, which may justify a higher PE ratio.
CRM's earnings are expected to grow with 13.58% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.36
PEG (5Y)0.81
EPS Next 2Y13.6%
EPS Next 3Y13.58%
5. Dividend
5.1 Amount
CRM has a yearly dividend return of 0.64%, which is pretty low.
CRM's Dividend Yield is rather good when compared to the industry average which is at 0.52. CRM pays more dividend than 89.49% of the companies in the same industry.
With a Dividend Yield of 0.64, CRM pays less dividend than the S&P500 average, which is at 1.92.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.64% |
5.2 History
CRM does not have a reliable dividend history as it only pays dividend since a couple or years.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
CRM pays out 21.86% of its income as dividend. This is a sustainable payout ratio.
DP21.86%
EPS Next 2Y13.6%
EPS Next 3Y13.58%
259.94
-0.59 (-0.23%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners84.48%
Inst Owner Change-0.06%
Ins Owners2.57%
Ins Owner Change-0.09%
Market Cap247.46B
Revenue(TTM)40.32B
Net Income(TTM)7.22B
Analysts79.66
Price Target332.22 (27.81%)
Short Float %1.73%
Short Ratio2.03
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.64% |
Yearly Dividend1.59
Dividend Growth(5Y)N/A
DP21.86%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.16%
Min EPS beat(2)3.73%
Max EPS beat(2)12.58%
EPS beat(4)4
Avg EPS beat(4)5.55%
Min EPS beat(4)0.37%
Max EPS beat(4)12.58%
EPS beat(8)7
Avg EPS beat(8)3.66%
EPS beat(12)11
Avg EPS beat(12)5.61%
EPS beat(16)15
Avg EPS beat(16)7.06%
Revenue beat(2)0
Avg Revenue beat(2)-0.56%
Min Revenue beat(2)-1.12%
Max Revenue beat(2)0%
Revenue beat(4)0
Avg Revenue beat(4)-0.68%
Min Revenue beat(4)-1.42%
Max Revenue beat(4)0%
Revenue beat(8)1
Avg Revenue beat(8)-0.55%
Revenue beat(12)2
Avg Revenue beat(12)-0.14%
Revenue beat(16)3
Avg Revenue beat(16)-0.22%
PT rev (1m)0.55%
PT rev (3m)-2.89%
EPS NQ rev (1m)0.05%
EPS NQ rev (3m)0.19%
EPS NY rev (1m)3.42%
EPS NY rev (3m)3.4%
Revenue NQ rev (1m)0.36%
Revenue NQ rev (3m)2.48%
Revenue NY rev (1m)0.58%
Revenue NY rev (3m)0.58%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.56 | ||
| Fwd PE | 19.77 | ||
| P/S | 6.14 | ||
| P/FCF | 19.19 | ||
| P/OCF | 18.33 | ||
| P/B | 4.12 | ||
| P/tB | 60.76 | ||
| EV/EBITDA | 19.75 |
EPS(TTM)11.52
EY4.43%
EPS(NY)13.15
Fwd EY5.06%
FCF(TTM)13.55
FCFY5.21%
OCF(TTM)14.18
OCFY5.46%
SpS42.35
BVpS63.05
TBVpS4.28
PEG (NY)1.36
PEG (5Y)0.81
Graham Number127.84
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.59% | ||
| ROE | 12.03% | ||
| ROCE | 12.04% | ||
| ROIC | 10.05% | ||
| ROICexc | 11.87% | ||
| ROICexgc | 114.64% | ||
| OM | 22.03% | ||
| PM (TTM) | 17.91% | ||
| GM | 77.73% | ||
| FCFM | 31.98% |
ROA(3y)3.46%
ROA(5y)3.61%
ROE(3y)5.81%
ROE(5y)5.94%
ROIC(3y)5.83%
ROIC(5y)3.79%
ROICexc(3y)7.18%
ROICexc(5y)4.68%
ROICexgc(3y)84.54%
ROICexgc(5y)53.64%
ROCE(3y)6.99%
ROCE(5y)4.55%
ROICexgc growth 3Y144.43%
ROICexgc growth 5Y51.1%
ROICexc growth 3Y136.01%
ROICexc growth 5Y54.45%
OM growth 3Y107.25%
OM growth 5Y49.51%
PM growth 3Y44.23%
PM growth 5Y85.88%
GM growth 3Y1.66%
GM growth 5Y0.52%
F-Score8
Asset Turnover0.42
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 0.65 | ||
| Debt/EBITDA | 0.69 | ||
| Cap/Depr | 17.92% | ||
| Cap/Sales | 1.51% | ||
| Interest Coverage | 38.61 | ||
| Cash Conversion | 110.06% | ||
| Profit Quality | 178.55% | ||
| Current Ratio | 0.98 | ||
| Quick Ratio | 0.98 | ||
| Altman-Z | 5.26 |
F-Score8
WACC10.9%
ROIC/WACC0.92
Cap/Depr(3y)19.53%
Cap/Depr(5y)21.06%
Cap/Sales(3y)2.13%
Cap/Sales(5y)2.49%
Profit Quality(3y)1155.13%
Profit Quality(5y)786.34%
High Growth Momentum
Growth
EPS 1Y (TTM)18.76%
EPS 3Y28.52%
EPS 5Y27.71%
EPS Q2Q%34.85%
EPS Next Y16.58%
EPS Next 2Y13.6%
EPS Next 3Y13.58%
EPS Next 5Y14.75%
Revenue 1Y (TTM)8.41%
Revenue growth 3Y12.67%
Revenue growth 5Y17.25%
Sales Q2Q%8.63%
Revenue Next Year9.34%
Revenue Next 2Y10.22%
Revenue Next 3Y9.9%
Revenue Next 5Y9.51%
EBIT growth 1Y20.93%
EBIT growth 3Y133.52%
EBIT growth 5Y75.31%
EBIT Next Year41.2%
EBIT Next 3Y19.35%
EBIT Next 5Y14.79%
FCF growth 1Y46.33%
FCF growth 3Y33.02%
FCF growth 5Y27.52%
OCF growth 1Y40.37%
OCF growth 3Y29.7%
OCF growth 5Y24.76%
SALESFORCE INC / CRM FAQ
What is the ChartMill fundamental rating of SALESFORCE INC (CRM) stock?
ChartMill assigns a fundamental rating of 6 / 10 to CRM.
What is the valuation status for CRM stock?
ChartMill assigns a valuation rating of 5 / 10 to SALESFORCE INC (CRM). This can be considered as Fairly Valued.
Can you provide the profitability details for SALESFORCE INC?
SALESFORCE INC (CRM) has a profitability rating of 8 / 10.
What is the valuation of SALESFORCE INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for SALESFORCE INC (CRM) is 22.56 and the Price/Book (PB) ratio is 4.12.
How financially healthy is SALESFORCE INC?
The financial health rating of SALESFORCE INC (CRM) is 6 / 10.